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Yahoo
4 days ago
- Business
- Yahoo
Should You Invest in the SPDR S&P Software & Services ETF (XSW)?
Designed to provide broad exposure to the Technology - Software segment of the equity market, the SPDR S&P Software & Services ETF (XSW) is a passively managed exchange traded fund launched on September 28, 2011. Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors. Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Technology - Software is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 6, placing it in top 38%. Index Details The fund is sponsored by State Street Investment Management. It has amassed assets over $477.14 million, making it one of the average sized ETFs attempting to match the performance of the Technology - Software segment of the equity market. XSW seeks to match the performance of the S&P Software & Services Select Industry Index before fees and expenses. The S&P Software & Services Select Industry Index represents the software sub-industry portion of the S&P Total Stock Market Index. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Global Select Market. The Software Index is a modified equal weight index. Costs Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio. Annual operating expenses for this ETF are 0.35%, making it one of the least expensive products in the space. It has a 12-month trailing dividend yield of 0.06%. Sector Exposure and Top Holdings Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis. This ETF has heaviest allocation in the Information Technology sector -- about 96.8% of the portfolio. Looking at individual holdings, Holdings Inc (BBAI) accounts for about 1.34% of total assets, followed by Cipher Mining Inc (CIFR) and Oracle Corp (ORCL). The top 10 holdings account for about 9.46% of total assets under management. Performance and Risk So far this year, XSW has lost about 2.88%, and is up roughly 28.48% in the last one year (as of 08/06/2025). During this past 52-week period, the fund has traded between $141.65 and $204.72. The ETF has a beta of 1.18 and standard deviation of 26.67% for the trailing three-year period, making it a high risk choice in the space. With about 142 holdings, it effectively diversifies company-specific risk. Alternatives SPDR S&P Software & Services ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, XSW is an excellent option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well. Invesco AI and Next Gen Software ETF (IGPT) tracks STOXX WORLD AC NEXGEN SOFTWARE DEV ID and the iShares Expanded Tech-Software Sector ETF (IGV) tracks S&P North American Technology-Software Index. Invesco AI and Next Gen Software ETF has $500.03 million in assets, iShares Expanded Tech-Software Sector ETF has $11.36 billion. IGPT has an expense ratio of 0.58%, and IGV charges 0.41%. Bottom Line To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SPDR S&P Software & Services ETF (XSW): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
15-05-2025
- Business
- Yahoo
Is SPDR S&P Aerospace & Defense ETF (XAR) a Strong ETF Right Now?
A smart beta exchange traded fund, the SPDR S&P Aerospace & Defense ETF (XAR) debuted on 09/28/2011, and offers broad exposure to the Industrials ETFs category of the market. Products that are based on market cap weighted indexes, which are strategies designed to reflect a specific market segment or the market as a whole, have traditionally dominated the ETF industry. Because market cap weighted indexes provide a low-cost, convenient, and transparent way of replicating market returns, they work well for investors who believe in market efficiency. However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta. By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such. This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results. The fund is managed by State Street Global Advisors. XAR has been able to amass assets over $2.98 billion, making it one of the larger ETFs in the Industrials ETFs. XAR seeks to match the performance of the S&P Aerospace & Defense Select Industry Index before fees and expenses. The S&P Aerospace & Defense Select Industry Index represents the aerospace & defense sub-industry portion of the S&P Total Stock Market Index. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Global Select Market. The Aerospace & Defense Index is a modified equal weight index. Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same. Operating expenses on an annual basis are 0.35% for XAR, making it one of the least expensive products in the space. It has a 12-month trailing dividend yield of 0.62%. ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis. This ETF has heaviest allocation in the Industrials sector - about 100% of the portfolio. Looking at individual holdings, Boeing Co/the (BA) accounts for about 4.24% of total assets, followed by Northrop Grumman Corp (NOC) and Huntington Ingalls Industrie (HII). Its top 10 holdings account for approximately 40.75% of XAR's total assets under management. The ETF return is roughly 10.83% so far this year and was up about 28.64% in the last one year (as of 05/15/2025). In the past 52-week period, it has traded between $138.69 and $183.59. The ETF has a beta of 1.05 and standard deviation of 21.90% for the trailing three-year period, making it a medium risk choice in the space. With about 38 holdings, it has more concentrated exposure than peers. SPDR S&P Aerospace & Defense ETF is an excellent option for investors seeking to outperform the Industrials ETFs segment of the market. There are other ETFs in the space which investors could consider as well. Invesco Aerospace & Defense ETF (PPA) tracks SPADE Defense Index and the iShares U.S. Aerospace & Defense ETF (ITA) tracks Dow Jones U.S. Select Aerospace & Defense Index. Invesco Aerospace & Defense ETF has $5.02 billion in assets, iShares U.S. Aerospace & Defense ETF has $6.88 billion. PPA has an expense ratio of 0.57% and ITA charges 0.40%. Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Industrials ETFs. To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SPDR S&P Aerospace & Defense ETF (XAR): ETF Research Reports The Boeing Company (BA) : Free Stock Analysis Report Northrop Grumman Corporation (NOC) : Free Stock Analysis Report Huntington Ingalls Industries, Inc. (HII) : Free Stock Analysis Report iShares U.S. Aerospace & Defense ETF (ITA): ETF Research Reports Invesco Aerospace & Defense ETF (PPA): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Sign in to access your portfolio
